Polluter

Pays
Principle
Introduction

The Polluter Pays Principle (PPP) recognizes the polluter to be responsible and liable for the
pollution. It signifies the polluter who has directly or indirectly implicated the environmental
harm to bear the costs of the enforcement when providing remedy. The judiciary generally
makes such enforcements so that harmed environment can be restored to a state that is
appropriate after an occurrence of pollution.

Origin

The Principle was adopted in 1972 for Governing Rules on International Economic
Implications of Environmental Policy by the OECD (Organization for Economic Cooperation
and Development), where polluters were kept accountable for environmental degradation and
pollution. The Rio Declaration eventually set out the Sustainable Development Principles,
implying a plan to address the needs of the existing generation without ignoring the
necessities of upcoming generations. To advance the goal of sustainable development, the
Polluter Pays Principle was codified in Principle 16 of the Rio Declaration1.

The OECD recommended expanding the PPP in 1989 to offset the costs for injury avoidance
and for incorporating the environmental costs incurred via mishaps. The OECD
recommendation was taken up by the European Community in its first Environmental Action
Policy (1973-1976) and, subsequently, the decision taken on March 3, 1975 on cost sharing
plus the action on environmental issues via public authorities. The idea has also been
enshrined in the Treaty of the European Communities and in various national laws in the
world since 1987.

Application of this principle in India

Legislative Framework

The legislature has not incorporated the Polluter Pays Principle explicitly in the
environmental law regime. However, they have indirectly tried to incorporate the features of
the principle in some of the acts

1. Public Liability Insurance Act, 1991- under this act the industries have to insure
themselves and the premium received from these insurance is deposited in an

1
UN Doc. A/CONF.151/26 (vol. I), 31 ILM 874 (1992)
 ‘Environment Relief Fund’, with the motive to provide quick relief to people harmed
by an industrial accident causing damage to the environment2.
2. National Environment Tribunal Act, 1995 provides with the penalty for non-
payment of amount that the tribunal has awarded against the industrialist for causing
harm to the environment3.

Judicial Pronouncements

Indian Judiciary has played a major role in development of the Polluter Pays Principle. To
make the interpretation of PPP easier, the Indian judiciary split the concept in two parts,
Environmental justice (Polluter Pays Principle) and social justice (Precautionary principle).
This includes direct as well as environmental costs to people as well as property. The motive
of the judiciary is to aid the environmental degradation and compensate the victim of
pollution.

In the judgement of Indian Council for Enviro-Legal Action v. UOI & Ors 4, they accepted
the existence of the Polluter Pays Principle. The court held that the factories causing pollution
are to be held absolutely liable to pay for the damage caused by their actions to the villagers
in the area affected along with the ground and the underground water and are obligated to
take all appropriate steps to eradicate all sorts of contaminants.

It is necessary to note that Oleum Gas Leak Case5 was the case where the court for the first
time applied the essence of the principle but did not name it. However, in Indian Council for
Enviro-Legal Action vs. Union of India the courts defined and applied the principle. The
courts said that people involved in hazardous or inherently dangerous activities have
responsibility towards environment. Any harm done due to such activity; the industry will
have to pay cost for 1) Reversing the ecological balance i.e. restoring the environment
balance and 2) Compensation of affected people i.e. victims6.

In the Taj Trapezium case7 the court expanded on the scope of victims and said that workers
of the industry are also to be compensated by the industry under the principle as they are also
the ones that are affected from as when the industry displaces itself the workers are likely to
lose their jobs.
2
Public Liability Insurance Act 1991, s 7(a)
3
National Environment Tribunal Act 1995, s 22, 23, 25
4
Indian Council for Enviro-Legal Action v. UOI & Ors AIR 1996 SC 1446.
5
M.C. Mehta vs. Union of India, AIR 1987 SC 965
6
Indian Council for Enviro-Legal Action vs. Union of India, 1996 AIR SC 1446
7
M.C. Mehta vs. Union of India, (1997) 2 SCC 353
In the Vellore Citizens Welfare Forum vs Union of India 8 the petitioner filed a PIL against the
pollution that is being caused by the Tanneries and other Industries due to the discharge of
untreated effluents into the River Palar. The court in this case discussed the principle of
sustainable development. They said that the balance between ecology and development must
be maintained and The Precautionary Principle and the Polluter Pays Principle are the two
arms of Sustainable Development. These principles are enshrined in the Constitution of India
and also in various environmental legislations like The Water (Prevention and Control of
Pollution Act 1974, The Air (Prevention and Control of Pollution) Act, 1981 and the
Environment Protection Act 1986 (the Environment Act). The court in this case established
certain guidelines which are to be followed by the tanneries and asking the Madras HC to
ensure that these guidelines are followed. The court applying the Principle said that the
tanneries were absolutely liable to pay for the damage caused by them to villagers staying in
the affected area, to the soil and to the underground water. This was justified by the court due
to the fact that even if pollution controls have been established now they are liable for
polluting the environment for over a decade.

The Loophole in the Indian Framework

In the Netherlands, it is the international standards that constitute and govern the functioning
of the state. However, in India, owing to its monotonous state, any legislative proposal for
changing or passing of laws must be presented and passed by either house of the Parliament.
Therefore, governing and constituting laws in India sits parallel to that of countries like the
Netherlands. This internal framework, in conclusion, is suggestive of the fact that India can
have reduced environmental standards in comparison to what is followed internationally
without requiring to justify it.

Taking this loophole into consideration along with the application of Polluter- Pays Principle
in India, the government can pin down the responsibility and liability on the polluter while
they might also be partly responsible for the harm. In cases where the alleged polluter
conferred to all the laws of the country but did not meet the international standards, the
government can simply pin the responsibility and liability for the environmental harm and
remedy on the polluter. Hence, the variation of the Polluter Pays- Principle, where the
government is to be held jointly liable, is needed instead of direct polluter's liability.

8
Vellore Citizens’ Welfare Forum v. Union of India and others [(1996) 5 SCC 647]
This model will ensure that all the victims will be compensated even at the expense of the
government and where the polluter has become insolvent or cannot be recognized, the victim
will still be compensated. Further, to ensure that the status quo between countries is not
affected by such paradoxical situations, “Equal Right of Access” has become a necessity i.e.
if a person is or is likely to be affected by trans-boundary pollution, that person will have an
equal right of access as if to the person living in that trans-boundary country.

Weaknesses in the Application of the Principle

Firstly, vagueness exists in figuring out 'who is a polluter'. This definition is broad and
unsupportive. The polluter might be an aspect of the "creation chain". Further, the
compensation amount is never enough to heal the ecological damage.

Secondly, countless helpless farmers, informal area firms, which chiefly serve the home
market, cannot manage any extra charges for garbage removal.

Thirdly, the principle lacks retrospective approach. The principle tends to create liability for
the future industrial pollution but it does not take into account the historical pollution.

Lastly, under this rule a polluter satisfies his commitments when he pays probably some of
managerial costs of the offices who control contamination exercises but what about the
irreversible damages. 'Exxon Valdez' case9 is a suitable example here.

Strengthening solutions

Following the beneficiary pays-rule, landowners who profit by an expansion in their land
estate value after a de-pollution cycle, need to pay for it. Some charges like urbanization
expenses or local equipment charges focus on this chance10. Carbon taxes should be legalised
for those who cause environment hazard by exploiting natural resources. Further, with the
elevated level of duties in many nations, a cut in other public costs is necessary. This calls for
joint subsidizing11. A qualification is to be made between the pollution now and from the
past.

Conclusion

9
Stephen Leahy, 'Exxon Valdez Changed The Oil Industry Forever—But New Threats Emerge'
(https://www.nationalgeographic.com/, 2019)
10
(Unece.org, 2020) <https://www.unece.org/fileadmin/DAM/ie/intersol/documents/s.8e.pdf>
11
Barbara Luppi, Francesco Parisi and Shruti Rajagopalan, 'The Rise And Fall Of The Polluter-Pays Principle In
Developing Countries' (2020).
The previously mentioned judgements by the Supreme Court has pronounced it in
unequivocal terms that the 'polluter pays principle' is well set up and has become an aspect of
the Indian environmental law with no legal command or prerequisite. The court has
consistently acted as the hero for the individuals who have suffered because of contamination
- be it man or nature. It makes abundantly evident that if an individual carries on risky action,
he has 'absolute liability' under civil law and criminal law. He will likewise be arraigned also,
rebuffed under the Environment (Protection) Act, 1986 and other related criminal laws 12.
However, it is insisted to take into consideration the strengthening solutions mentioned above
for effective application of the principle.

12
Section 15 of the Environment (Protection) Act, Criminal liability has also been provided under sec. 268, 277,
278 and 290 of the Indian Penal Code,